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Jaguar Mining Inc. (JAG)

Q4 2007 Earnings Call

March 25, 2008 9:00 am ET

Executives

Daniel R. Titcomb – President, Chief Executive Officer

James M. Roller - Chief Financial Officer, Treasurer

Bob Zwerneman - Director of Investor Relations

Analysts

Sam Stein –

Matt Helman – Individual Investor

Craig Miller – BMO Capital Markets

Unidentified Analyst – Equinox Partners

Presentation

Operator

Good morning and welcome, ladies and gentlemen, to the Jaguar Mining Fourth Quarter and Fiscal Year 2007 Earnings Conference Call. (Operator Instructions) It is now my pleasure to introduce Mr. Bob Zwerneman, Director of Investor Relations for Jaguar Mining. Please go ahead, sir.

Bob Zwerneman

Good morning everyone. Thank you for joining us on our Fourth Quarter and Fiscal Year 2007 Earnings Conference Call. With me today I have Mr. Dan Titcomb who is Jaguar’s President and CEO, as well as Jim Roller, Jaguar’s Chief Financial Officer.

We will be making forward-looking statements on the call this morning and we refer you to the language in yesterday’s press release, which is available on our website. Also, I believe Dan will be referring to slides that are part of our investor presentation and you can find our Corporate Presentation under our Investor Relations tab on Jaguar’s web site, which is www.jaguarmining.com. So with that I will turn it over to Dan.

Daniel R. Titcomb

Thanks, Bob. Good morning, all. Today I am going to focus primarily on our growth initiatives and the program to grow the company from its program that was announced shortly in the past year, about a month ago. We’re moving the company from a 400,000-420,000 oz Au producer to a 700,000 oz Au producer.

Regarding our financials in the quarter, the results—the annual results—I will leave you to read the press release which I think did a reasonably good job at summarizing those results and we will certainly open the forum up for questions at the end to give you a chance to ask any specifics on the press release.

I will provide a summary here really pressing on five major points as we talk about our growth initiatives and again, to add to what Bob said, I would encourage you to go to the web site and look at the Corporate Presentation as it details the growth program and what will be taking place, now through the next couple of years to achieve that new production profile of 700,000 oz Au.

The primary items that we’ll discuss today is people, underground development and exploration, above-ground initiatives, equipment, and our corporate initiatives.

The core of the company’s growth--the most strategic item for us to achieve our objectives that we’ve laid out for all of you recently--is building that management and operational team. Today we have roughly 1,000 employees; about 99% of them are Brazilians. In 2007 we added 250 employees, which included an extensive training program. We have to grow a lot of these employees in skill sets organically, so we have committed ourselves to that process over the last two to three years, which includes having an in-house school and training facilities. Our employees average about 12 hours a month in skill development and additional educational aspects of the mining safety and environmental items.

As we look forward in 2008 and 2009 we will be adding about 250 people per year in order to meet our objective. Really for 2008 we’ve got the staffing in place for our 2008 initiatives, however, we need the lead time to go back in so you so you’ll see us adding people continuously throughout the year, again, at a rate of about 250 per year for the next two years.

It’s a challenging environment that is a strong mining sector with high demand for all trades. Even more difficult to do the expansion of mining in the country of Brazil, but really specifically in the district.

As a smaller company, Jaguar has some incentives to offer: we have an attractive growth profile which brings a lot of attention to the company, allows us to attract new talent; we have equity participation, which is a key element for our ability to attract and maintain our people in Brazil—another form of compensation but I can’t emphasize enough how important that is in this environment. And our company is quite visible and has had a lot of local success and therefore we do garner attention, which has been a benefit.

Also, our people tend to live at home, which is a tremendous benefit. I think in the long run; primarily we don’t lose people to the fact that they’re away from their family. They’re home most every night and that’s a big benefit. So the reason to emphasize that a little bit more today is to show you that there are elements that are inherent inside Jaguar’s business model that helps us de-risk the items in the future issues, allowing us to probably better achieve these aggressive objectives that we’ve put forward.

Our skill condition, Jaguar, as I mentioned, has trained—we’re equipped to do so and again, we’ve really put that time and energy, and you’ll see some of the administrative costs that are reflected in our financials really speak to the fact that we’ve committed to the lead times and the upfront expense to build that operating team. So for us there’s a lot of equity in those expenses in value and it is an absolute necessity. If we’re going to grow this company to that 700,000 oz Au sustainable production rate, we’ve clearly got to add another 500+ people and I really can’t emphasize that enough, how important that is. But with a core group of 1,000 people today we have the internal skill set built to grow the team and train internally. So we’re in fairly good condition to be able and achieve that.

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